Reflexite's version of the employee suggestion box does more than just record complaints. It encourages companywide awareness of problems, their costs, and their possible solutions* * *
During the 1980s legions of companies latched onto incentive-based employee-suggestion programs as the answer to all their problems. But like most management theories dreamed up far away from the factory floor, those programs unleashed more problems than they solved. Managers became overwhelmed when they had too many problems to fix. Employees felt slighted if their suggestions weren't given top priority. And little or no money was budgeted for implementing suggestions.
One manager who has thought long and hard about the pros and cons of suggestion systems is Matt Guyer, the manufacturing manager for $31-million Reflexite Corp., in Stamford, Conn., the company that walked off with the Inc./Ernst & Young Entrepreneur of the Year award in 1991. That was after the CEO of this reflective-plastics-manufacturing company, Cecil Ursprung, had charged Guyer with the task of "creating a feedback loop where suggestions don't get lost, one that doesn't duplicate the existing structure for getting things done in the company."
Guyer, a total-quality-management aficionado, read up on the topic; then he and a cadre of representatives from various departments met for a day to reinvent the wheel. What they came up with was the Employee-Assistance Request form, the linchpin of a system that came to be known around the company by its acronym, EARS. "EARS works," explains Guyer, "by making people who identify problems step back and quantify the magnitude of the problem and its impact on the entire company before offering a solution. That allows them not only to offer better solutions but also to understand why some problems are given a higher priority than others."
Mind you, the EARS system doesn't mean just another form to fill out; it's a program. In the year since Guyer held that initial meeting, every employee has attended classes to learn the steps and skills necessary to solve a problem correctly. Before the system was in place, employees might have thought they intuitively knew the cause of a problem; with EARS, they document it, plotting and graphing potential causes and keeping notebooks to track the amount of downtime a problem causes or how much scrap is wasted.
Once someone identifies a problem, an action leader is assigned to work with the individual on conducting the studies and filling out the form. Teams of employees may be assembled to solve particularly thorny problems that cross departmental lines. Money is allocated to each EARS request, no questions asked. As for self-discipline, there's plenty of motivation engineered into the EARS system. Progress is charted on bulletin boards found throughout the company. And first thing each Monday morning at the managers' meeting, Ursprung reviews the EARS log to find out what's holding up progress.
So far, of the 105 EARS forms that have been turned in, "we've had a couple come in that have saved us thousands of dollars, and we've had a dripping pipe fixed. Too often managers are looking for the one big hit, but EARS makes us pay attention to all these small problems that have a long-term cumulative effect on morale and the bottom line," says Guyer.
On the following pages is [an annotation of] one of the first EARS forms turned in. Guyer explains the critical path of problem solving that was mapped out in his initial meeting and reinforced in the quality class. "This system is a relief for managers," he says. "We'd be really excited if we got to the point where the logic of EARS took place without the paperwork."
1. The originator turns the [Employee Assistance Request Form] in to the EARS coordinator (not a full-time position). 2. An action leader is assigned to the problem the same day. 3. The action leader contacts the originator within 24 hours. 4. Together, they fill out as much of the [EARS investigation] form as possible and progress through problem-solving steps. They may or may not need a team. 5. The leader and the originator give activity updates to the coordinator, who updates the EARS log. 6. When the problem is solved, the coordinator puts it in a holding file until the follow-up date. 7. On the follow-up date the coordinator double-checks to make sure the problem has been solved, and the originator signs off on the form. If the problem hasn't been solved, the EARS form is sent back into the system for more work. 8. Two weeks after the EARS form has been closed, the coordinator distributes forms to top managers, who visit the EARS originator and discuss how things went. 9. An EARS certificate of appreciation is given to the originator.
"This machine [Thermatron #6] had been jamming up periodically," says Guyer. "For [form originator] Jill [Dorbuck], it was important to fix it, but for her managers, it was a lower priority. She complained about it, but it always got put on the back burner."
"We assign an action leader, who makes contact with the originator within 24 hours. That way the person gets reinforcement right away, and the two can set up a schedule. Sometimes the action leader needs to have some expertise in the problem area, but mostly he or she just needs to know how to solve a problem. We had one of our market managers be an EARS leader for scrap disposal on one of the lines. Often a person without technical knowledge doesn't bring any agenda to the problem, and won't be afraid to ask all the 'dumb' questions. People really start learning about the big picture of what's going on outside their little area. Leaders aren't always managers, either. All employees here see participating in EARS as part of their regular jobs."
The Price of Nonconformance (PONC)
"This is the bottom line. How much is the problem costing the company? By quantifying the cost of a problem, people can understand why some problems are more urgent than others. Together, the action leader and the originator figure out how much the problem is costing the company. How frequently does it occur? How much material is wasted? How much does it hinder other people's work? [See Measurement section.] Ideally, Mike Ream, the action leader here, would have filled this section out more. This problem was probably costing us $150 a month." [Ream wrote only "Problems occur 3-4 times per day"]
"This is essentially a Band-Aid ["Monitor operation and splice out bad material"]. We want to know what's keeping us going while we figure out the root cause. Making the temporary fix part of the form keeps us from letting the Band-Aid serve as the permanent solution."
"In this instance, just by looking at the machine, Mike could tell that the root cause was a worn-out cylinder. But we once had a team that determined 67 potential root causes of a problem. So we charted how many times the problem occurred as the result of each suspected root cause. Out of the 67, we identified 3 of the root causes that were by far the most vital. This rigorously logical approach keeps the number of arguments down by taking all the subjectivity out of the problem-solving process."
"Ideally, Mike would have quantified how much time and product was wasted and determined what the opportunity cost was. He and Jill could have decided to put a log on the machine, asking workers to record how much material was lost because it was spliced and how long the machine was down.
"It's likely that few of us had a good sense of what our time costs were when we started EARS and how time and money can be lost in a thousand little ways. Too often managers are looking for the one big money-saving hit."* * *
"What's a reasonable schedule for solving the problem? ASAP doesn't mean anything. Whom do we have to train? Basically, this section helps the leader envision what we're getting ourselves into here. Each problem is automatically given a budget of $500, no questions asked, and the originator gets eight hours of time to help solve the problem. Eighty percent of the EARS solutions just require rethinking something and don't require an actual cash expenditure."
"By documenting the action taken, we have a bank of answers ready if one of the problems comes up again in the future."
"The first item on the agenda of the Monday-morning management meeting is the EARS log. Cecil goes over what's overdue and keeps things moving. The log is posted all over the place, so people see what stage the work is in. That way, someone who worked on the Thermatron #6 may say, 'Oh, I know how to solve that. I didn't know that was still a problem.' We put the EARS form in a holding file, and it is revisited at a follow-up date. There's a tendency for people to want to close out a problem as soon as it's been solved, but we try to avoid that. On the follow-up date we go back to the person who originally reported the problem to make sure everything's OK; then the originator, the action leader, and the coordinator all sign off on it."
Recognition and Morale Building
"After the follow-up date, once every two weeks the top managers are given an EARS form, and they take 15 minutes to find the person who turned in the EARS and thank him or her. That way, the managers get to meet someone they might not ordinarily have a lot of contact with. Recently, we developed a certificate of appreciation for EARS contributions, and we give those out at companywide meetings. We are also filing EARS contributions in people's annual-review folders, so we keep track of this new part of everyone's job."